Fire in motorcycle workshop was covered by car liability insurance

In May 2021, a fire broke out at a motorcycle workshop in Bergen, caused by an electrical fault in one of the motorcycles under repair. The motorcycle was insured by Gjensidige, and both the workshop and the building's insurer sought compensation from Gjensidige, which denied liability.

It was undisputed that liability, at the outset, existed under section 4 of the Automobile Liability Act for damage caused by a motor vehicle. The question was whether the exception in section 2 (b) of the Act applied. This provision makes an exception for damage that occurs while the vehicle is properly stored in a place inaccessible to the public.

The Supreme Court ruled that the exception in section 2 (b) of the Automobile Liability Act did not apply, meaning the loss was covered by automobile liability insurance. This decision was based on the "carport case" (HR-2021-822-A), where a parked car caught fire. The exception in section 2 (b) must be understood in the light of Article 3 of the EU Motor Insurance Directive, which states that insurance should cover the use of vehicles. According to case law from the EU Court of Justice, parking between trips is considered part of the use of a vehicle. Similarly, workshop stays should also be considered part of the use of a motor vehicle.

This ruling clarifies the scope of automobile liability during workshop stays.

Read the judgment from the Supreme Court (Norwegian) (PDF)

Areas of law: Insurance law, motor vehicle liability, section 2 (b) of the Automobile Liability Act

Key paragraphs: 41, 53, 58, 59

Justices: Falkanger, Berglund, Thyness, Hellerslia, Lund